Everyone wants to know that the investments they’ve made are worthwhile and profitable. It’s especially important when it comes to larger investments, such as your home. So, the real question becomes: How do you increase the value in your home?
Start with the Current Market Value of Your Home
Before you can begin working toward increasing the value in your home, it’s important to know the current market value. You will be able to use this as a benchmark moving forward. While you can work with your local bank to determine the actual value, you can start with an educated guess yourself if you want to start immediately. Here are a few tips to get you started:
#1 Know Your Home
Begin by getting to know your home inside and out. Review home characteristics, such as location, internal components, and external components.
- Home Characteristics.
- Are you located in a good school district?
- Is your neighborhood growing?
- How many houses are currently for sale in your area?
- Internal Characteristics
- Square footage
- Construction quality
- Number of rooms
- Energy efficiency
- External Characteristics
- Overall home condition
- Age of the home
- Amount of land
- Style of architecture
- Sidewalk conditions
#2 Research Similar Properties
Now that you have this information at your fingertips, research similar properties that have recently sold in your area. Take an average of 3 to 5 homes.
If you know the properties that have recently sold, you can look up their information on the auditor’s website. Otherwise, ask your real estate agent or broker. Compare the information to get an approximate idea of the value.
The average cost to appraise a house is $316. However, if you’ve recently purchased the property, you or your bank should have an appraisal.
Building Value in Your Home
When wanting to build value in your home, the first thing that comes to mind is typically remodeling rooms. While this is a great idea and quickly brings value into the spaces you already have, begin with structural problems. Be sure to look for defects, such as a leaky or bowing roof, cracks in foundation, mildew or mold, insect infestations (ants, termites, etc.), and unstable chimneys. While some of these repairs may be on the pricier side, they are absolutely essential to maintain your home’s value.
HGTV asked whether these basics mattered, and the overwhelming response is that they did. Potential buyers do not want to purchase problems.
Siding replacement recouped 98.2% of its cost, according to Remodeling Magazine. Replacing roofs and windows earned back over 80% upon resale.
From here, you should begin updating the wiring and plumbing in your home. Wiring is extremely critical, as older wiring can be a fire hazard. The easiest way to determine if wiring is old is by checking the age and quality of your fuse box. Plumbing is also important, as old plumbing can lead to insufficient hot and cold water, as well as burst pipes. Finally, be sure to update the central heating in your home. This can increase energy efficiency and lower overall heating bills.
After all the previous repairs have been made, now is the time to remodel rooms and improve overall “curb appeal”. We suggest starting with the kitchen, as it has the greatest return on investment of any room of the house (92.9%). This can be as simple as changing the room’s color with a fresh coat of paint and staining wood cabinets or it could be a complete remodel. The amount of work and money is entirely up to you.
Outside of basic room repair, don’t forget to update other portions of the home as well. Peeling paint, squeaky stairs, and cracked plaster all can reduce the value on your house. Be sure to leave no stone unturned.
Home Repair Takes Time
Remember: Home remodeling and repair take time. It’s a marathon, not a sprint. Start with one room at time, and don’t overextend your capacity. Work with your local bank to determine the best lending strategy to make all the necessary and desired repairs. Before you know it, you will have the home of your dreams!